Customer Assistance Programs Integrated Into Business Processes Can Help Struggling Ratepayers Stay Afloat
By Neil Grigg
Rate increases by water utilities are needed to sustain high quality services, but their impacts on low-income customers are a major cause of concern.
In some communities, these concerns can fly under the radar, but in others they can spark social unrest. While the general issue is not new, concerns about the impacts of rising costs on affordability of water service are becoming more intense. Within the water community, there is consensus that utilities should operate as businesses, but they will also be confronted by affordability issues for low-income customers.
Here, we’ll focus on affordability issues of water supply services, but wastewater and stormwater utilities face similar issues. The discussion clarifies the difference between the community criteria published by U.S. EPA and individual affordability issues of low-income customers who are often trapped in poverty and subjected to hardship. We’ll review the information published during the last two decades about customer assistance programs in utilities and, drawing from this, examine suggestions to address the dual concerns of system needs and affordability for low-income residents.
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I think the notion of CAPs is problematic for small community systems in rural parts of the country. In that scenario you are unlikely to have affluent districts or neighborhoods that can subsidize their less affluent neighbors.
To allow for CAPs in the rural parts of the country would necessitate either state or federal meddling/governance of these small systems.